11 December 2018

Major events: planning for the unexpected

New Zealand is a popular destination for world-class events. Every year we have more happening, to keep punters entertained and event organisers awake at night.

Big event planning does have risks. There's the rain - and because we are often at the end of long world tours it is not unusual for performing artists to cancel shows due to poor health or personal issues. Experienced event organisers don’t plan for things to wrong, but they do plan for the risk that things outside of their control might happen.

Risks to events in New Zealand

Major concerts, shows and events have enormous financial benefits for promoters, local businesses and the wider economy. We have the infrastructure and expertise to manage big crowds and complex logistical requirements. The insurance industry plays a key role in ensuring the continuation of the concerts, festivals and matches we enjoy.

Whether it's a high-profile concert, an international conference, sports fixtures, performances, fetes, fundraising events or even a wedding, major events require significant investment and can carry substantial risks for cancellation, abandonment or postponement due to weather or issues like construction delays. There are other also risks dependent on the location and type of entertainment, and issues around transport delays, sickness, staffing problems and equipment failure.

When concerts, festivals and sports matches can't go ahead as planned, event insurance comes into play. In most cases, event organisers take out insurance for irrecoverable costs and expenses due to unavoidable cancellation, abandonment or postponement. They can also insure for any additional costs such as moving to other venues.

Pluvious insurance for weather cover 

The obvious threat to outdoor events like sports, concerts or festivals in New Zealand is the weather. Wild weather forced organisers to make changes due to safety concerns at a recent Ed Sheeran concert.  Known as Pluvious insurance, weather cover is not only for ticket refunds but includes other risks like stage-builders, venue hire, staffing salaries and expected profits.

Organisers can also insure for when the event goes ahead, but due to the terrible weather, revenue is well down. Sometimes, it may prove difficult to agree how many people stayed at home because of rain, so in most cases the insurers will fall back on statistical information about the event, the band and the venue.

Clearly you must make sure you insure your event against rain well in advance, and not when you’ve just seen the long-range weather forecast.

Concerts and events are for the public

In New Zealand, public liability insurance  is not usually a compulsory requirement, but it's an incredibly important consideration if you run a business that involves interacting with the public. If your business is ordered to pay damages for injury or property damage, public liability insurance will cover these costs as well as any associated legal or hospital fees. It can be the difference between your business staying open to host future events or going bust.

Prize indemnity

What happens if a member of the public gets that hole-in-one, catches a six at the cricket matches or guesses the lucky number? Who actually pays out for the prize that has been offered? Promotional prize insurance covers promotions where the participants are offered the chance to win prizes - in the form of games, contests and competitions. Instead of keeping cash reserves to cover large prizes, promoters pay a premium to an insurance company who then reimburse them should a prize be won. The most popular prize indemnity offering is Hole-in-one insurance. The prize gets paid for by the insurer and the business just pays the small fee to ensure their golf day is a huge success.

Prize insurance is also known as prize coverage, prize indemnity, contest insurance, game insurance and promotional insurance. We provide a solution against the risk that the prize will be won, with the insurance premium calculated based on the prize value and likelihood of a win. Prize indemnity ensures our clients are not at a loss should they hold, take part in or organise a prize giveaway.

Got an event happening?

Event insurance is a niche area. With so many things for you to organise and the fact no two events are the same, you should talk to a broker early in your planning. We’ll take the time to clearly understand your event and make sure you're covered for key risks, like public liability and bad weather for the best price.